The chant was allegedly made last week on one or more buses during frosh orientation events sponsored by the Commerce Undergraduate Society.
A similar incident at Saint Mary's University in Halifax recently prompted the resignation of the president of the student association.
Robert Helsley, dean of the Sauder School of Business, said Monday he and Louise Cowin, vice-president of students, have launched an investigation into the incident and a fact-finding team is expected to report back by Sept. 16.
Faculty will also increase the emphasis on issues like respect, dignity and ethics in their curriculum, he said.
"These activities are completely inconsistent with our values as a school, and they're also inconsistent with everything that I know about our student body," said Helsley.
"This has come to be interpreted as a blanket indictment of the Sauder School of Business and its students and that is just not true."
Frosh events are run by commerce undergraduates, but Helsley said the school has traditionally supported them by providing technical support and guidance and even writing invitations.
Helsley said the school knows some rough details about the allegations, but it wants to learn more, such as how many people were involved and how many times the chant was repeated.
While it's too early to speculate on the results of the investigation, university policy considers a range of sanctions from warnings to expulsion, he said.
He said the faculty will support future team-building events and activities by its undergraduates, but will only do so if students can assure the school they're meeting university standards for appropriate conduct.
Helsley also called graffiti left on a commerce building early Monday "troubling," but the facility has now been repaired.
A photo on the website of the Ubyssey, the student newspaper, showed an expletive denunciation of "rape culture" spray painted on the building and another scrawl saying "Sauder teaches rape."
"People are expressing their indignation over these events, and I share those views," he said. "I was very saddened to hear what had happened early this morning but I understand that people are upset."
Arno Rosenfeld, features editor of The Ubyssey, the student newspaper that broke the story, said the issue has become big news on campus.
"Some people are very outraged by this. Other people say 'Why would our newspaper want to drag UBC through the mud? It's not that big of a deal. Everybody does it. Kids are just having fun.' So those have been the two perspectives, I think."
Geoff Lister, co-ordinating editor of The Ubyssey, said he thinks there are lots of offensive chants during frosh events but the chant in question didn't make it "from Halifax to Vancouver without making a few stops along the way."
Similar controversies have dogged the university in the past few decades.
In November 1990, the RCMP announced it would not lay criminal charges against a group of male students who sent offensive and obscene letters to about 300 women at their residences.
The letters were invitations to a tug-of-war.
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